what’s next for packaging? - fppa€¦ · middle-class retreat (urban, educated, having fewer...

WHAT’S NEXT FOR PACKAGING?

FPPA Annual ConferenceColleen Twomey

Associate ProfessorCal Poly State University

San Luis Obispo, CA

First – Thank You

Packaging Trends■ Drivers

– What’s going on in industry

– What do the academics see?

■ Trends in packaging■ Design■ Sustainability■ Connected

Consumers■ E-Commerce

Drivers shaping megatrends and ultimately consumer markets (Euromonitor)

With the rising importance of emerging and

frontier markets, and

fears over advanced economy

stagnation, the global economy has witnessed

a paradigm shift.

Technology plays a pivotal

role in consumer decision-

making and the ability of

business to meet the needs

of today's consumer.

Competing demands and

supply constraints

combine with economic,

environmental and geo-

political risks to create

pressures on environmental

resources.

As the global population

approaches 8.0 billion,

demographic shifts are

combining to reshape

consumer lifestyles and purchasing decisions.

From consumers to governments, beliefs about the world are

constantly evolving, shaping

priorities, perceptions, attitudes and motivations.

0 10 20 30 40 50 60

Mexico

UK

Brazil

Germany

Russia

Japan

Indonesia

India

USA

China

GDP at PPP, trillion international dollars

Top 10 Economies 2030GLOBAL ECONOMYWILL DOUBLE INSIZE AND REACH$256.1TRILLION IN TERMSOF GDP AT PPP (PURCHASING POWER PARITY)

IN 2030

Driver 1: Shifting Economic Power

10 Fastest Emerging Markets

0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0

Côte d'Ivoire

Sierra Leone

Laos

Philippines

Bangladesh

Mozambique

Rwanda

Myanmar

Ethiopia

Guyana

Average annual real GDP growth, %

10 Fastest Growing Emerging and Developing Countries 2018-2030

Source: Euromonitor International from national statistics/Eurostat/OECD/ UN/IMF

Driver 2: Technology

3.6bnGlobal internet users as of 2018, which equates to half of the population.

31%of connected consumers prefer online communication rather than other means.

53%of connected consumers report they would be lost without the internet.

■ The always-on consumer

Driver 2: Technology

0

10

20

30

40

50

60

70

80

90

100

2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Consumer Access to the Internet Globally 2017-2030

Percentage of Population Using The Internet Percentage of Population Covered by at least an LTE/WiMAX Mobile Network

Driver 3: Population Change

POPULATION (BILLION)

8.5MEDIAN AGE (YEARS)

32.8

World Population Statistics 2030LIFE EXPECTANCY (YEARS)

74.4

Population by Urban/Rural Location 2030

Source: Euromonitor International from national statistics /UNNote: Top 10 cities are based on the biggest cities by forecast population in 2030

Driver 3: Population ChangeUrbanization MigrationAgeing

61.0% of the world’s population will be urban in

2030. There will be 38 megacities - cities with

populations over 10.0 million.

995 million people will be aged 65 or over in 2030. One

quarter of them will live in China.

Net migration will account for more than half of population growth to 2030 in Western

Europe, Australasia and North America.

Three major demographic forces shaping the world

Driver 4: Environmental Shifts and Pressures

Ethical consumers

War on plastics

Circular economy

UN sustainable development goals

Going beyond regulation

Driver 5: Changing Values

0

2

4

6

8

10

Long-term financialsecurity

Establishingfinancial security

Spending leisuretime doing my

favorite activities

Being wealthy Satisfying Work Following mypassion(s)

Spending money tomake life

easier/better

Making asignificant

difference in theworld

% o

f res

pond

ents

Baby Boomers Generation X Millennia ls Generation Z

Source: Global Consumer Trends Survey 2017

Financial security key priority for baby boomers, but for gen Z, it’s all about their passions in 2017

Mega Trends■ Experience More (over “stuff”)

■ Shifting Market Frontiers (growth in Asia/Africa, ageing population)

■ Healthy Living (greater awareness of health and nutrition)

■ Ethical Living (resources, environment, sustainability)■ Middle-Class Retreat (urban, educated, having fewer children)■ Premiumization (Ageing consumers, smaller families drive

demand)■ Shopping Reinvented (convenient and technology-advanced

experience)

■ Connected Consumers (rapid urbanization and pop growth will give rise to more connected consumers)

What can that mean for packaging?

■ $ 839B 2015 –$ 998B 2020 (3.5%)■ Global growth not

even– Emerging

countries– Established

region changes in demographics

https://qz.com/622211/finally-marijuana-packaging-that-doesnt-look-like-it-was-designed-by-a-stoned-teenager/

Source: PIRA

What can that mean for packaging?

■Design trends (with the brain)■Sustainability■Connected Consumers■E-commerce

Design Trends

– …”attractive vs. neutral packages evoked intensive activity changes in brain regions associated with an impulsive system..” (Hubert, 2013)

– ???– Attractive packaging

increases impulse buying!!!

Design Principles

–Color–Shape–Symbol–Typography

Cred: Andrew Hurley

Color

Color Associations

Color Associations

Color Associations

packagingdigest

Americans complained that the Coke in the white can tasted less sweet

Cope.com

Many other examples…

■Typography■Label shape■…

Design Trends in Packaging

■Retro/Vintage

Design Trends in Packaging■Sequencing

Design Trends in Packaging

■ Typography getting “hip”

Design Trends in Packaging

■Minimalism (essentialism)

Design Trends in Packaging■Humor

Design Trends in Packaging■Humor

Design Trends in Packaging■Humor

Neuroscience

“After the eye, the hand is the first censor to pass on acceptance, and if the hand’s judgment is unfavorable, the most attractive object will not gain the popularity it deserves. On the other hand, merchandise designed to be pleasing to the hand wins an approval that may never register in the mind, but which will determine additional purchases… Make it snuggle in the palm.”

Sheldon and Arens, 1932

Design Trend: Tactile and Decoration

Design Trend: Tactile and Decoration

Design Trend: Tactile and Decoration

Sustainability■ Flexible material trends

– Move from paper to plastic– Light-weighting– Move from rigid to flexible (consumer

convenience)■ Demand for pouches in the US – 4.6% per

year to $9.4B in 2018 (Freedonia)– Increased use of “Bio-plastics”■ Fossil fuel costs■ Reduced carbon footprint■ New generation bio-renewable

technologies– Smith Pira – Future of Bioplastics for

Packaging to 2023

Examples

spence

• Coke bottle• 30% Brazilian cane sugar• 2020 goal of having a completely

renewable plant based and recycled PET plastic bottle

• DANONE Yogurt• PLA• Improve carbon footprint of Activia by

25%• Cut use of hydrocarbons 43%

• Packaging gateway.com

Be careful…..

Sustainability

■ “Sea Change”

Sustainability

■Creating more relationship between brands and consumers–How2Recycle

Carton and Corrugated

■ E-commerce/International Trade■ Downsizing■ Single Serve■ Printing techniques■ Smart Packaging ■ Growth in emerging countries■ New markets (wood replacement)

– Projected to reach $294.3 billion by 2023 (globally) Freedonia

Examples■ Tetra Top (liquid packaging, coatings)■ Corrugated Cases (RRP)

Packworld.com

Tetrapak.com

• Convenient products becoming a key need for 'on-the-go' consumers looking for instant gratification.

Designing for Sustainability

Be careful of “eco” inks – not all of them can be recycled!

■ QR experience– QR codes as a means for marketers to bridge the gap

between the physical and the digital worlds■ NFC Experience

– A recent survey by Epsilon and GBH Insights found that 80% of customers are more likely to make a purchase when brands offer bespoke (custom) content.

■ AR Experience– Augmented reality is most effective during the search and

evaluation phases of the buying process.

• The use of technology needs an incentive for Millennials and Z-ers (why should they interact with the package?)

• Experiences with the technology need to be memorable and relevant

• Don’t expect Millennials/Z-ers to pay more for interactivity

• Technology needs to work on all mobile platforms• Millennials/Z-ers don’t have the attention span to

wait for technology to work – if the technology takes too much time, they have already moved on

That said….

Other■ DigiMarc– “invisible” barcode– Conversion of

pixels to readable data

– Greater accuracy and speed at checkout

– Engagement via coupons, loyalty programs, etc.

E-Commerce

■ Customize (Digital)■ “The Unboxing

Experience”■ Integrated

Marketing Communications

Customize■ Digital Printing is in all areas of packaging - $28B by 2023

– Quality– Volume– Color– VDP

■ But– Print – to – Die speeds– Heavy use of spot colors– Expense– Installed base– ….

■ Integrate?marketsandmarkets

Customize

Examples

The “Unboxing Experience”

■ Youtube….?■ Amazon

Frustration-Free Packaging■ Subscription

Boxes

Example

Frustration Free Packaginghttps://youtu.be/bgw3EmszzLY

Opportunities for Design!■ Subscription Boxes!

Let’s think INSIDE the box!

Integrated Marketing Communications■ Digital Shelf – Who cares about e-commerce and

online orders?– Product assortment– Multiple images of a product– Videos– Descriptions– Ingredients– Instructions– Pricing and promotions…

Unilever■ Close to 10% of retail sales

are now online, and 50-70% of these purchases are made on a mobile device■ Unilever saw 24% increase in

sales with optimized hero images over product shots■ Other CPGs are following

Opportunity?■ Rich, high-quality product content

– Digital package– Lifestyle images– Video Content– Descriptive Copy...

Packaging Trends■ Drivers

– What’s going on in industry

– What do the academics see?

■ Trends in packaging■ Design■ Sustainability■ Connected

Consumers■ E-Commerce

Thank you!